U.S. defense spending rose 72 percent to $671.7 billion for fiscal 2008 from $381.3 billion in 2000, after adjusting for inflation and including spending for the wars in Afghanistan and Iraq.
The new Democratic administration faces decisions on $125 billion in major weapons programs:
the purchase of additional Lockheed Martin F-22 fighter jets and Boeing Co.’s C-17 transports;
the replacement of Air Force refueling tankers and combat search and rescue helicopters;
the acquisition of a new satellite communication system;
and, a decision to curtail buying the Navy’s DDG-1000 Zumwalt class destroyer, and buy more older DDG-51 type destroyers.
“When a new president is inaugurated, these circumstances that we are talking about now are not likely to change all that much,” Lockheed Chief Executive Officer Robert Stevens stated.
The expected rate will be approximately the same, 4% of the GDP, as defense spending has been. Likewise, the Pentagon also plans to increase the Army’s troop strength by 65,000 and the Marine Corps’ by 27,000 by 2013, adding to the military budget. Obama supports the troop-strength increase. “I don’t see defense spending declining in the first years of the Obama administration,” stated Richard Danzig, Obama’s defense adviser and former Navy secretary.
“The long-term fiscal challenges confronting the United States, linked to rising health-care costs and the aging of the U.S. population, all seem to support the conclusion that the base defense budget is likely to stay relatively flat in real terms,” not counting war costs, Steve Kosiak, a defense budget analyst at the Center for Strategic and Budgetary Assessments, a Washington policy group, stated in a report last month.
War is often good for business and the American economy needs a kick, jobs depend on it.
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